Slide 1: FY11 Third Quarter Earnings Call
FY11 Third Quarter Earnings Call August 9, 2011 August 2011
Slide 2: Agenda
Agenda TransDigm Overview W. Nicholas Howley Chairman and CEO Highlights, Market Review, Operating W. Nicholas Howley Performance and Outlook Chairman and CEO Operations, New Business and Value Creation Raymond F. Laubenthal President and COO Financial Results Gregory Rufus Executive Vice Pr
Slide 3: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including information regarding our guidance for future periods. These forward-looking statements are based on management’s current expectation
Slide 4: Special Notice Regarding Pro Forma and Non-GAAP Information
Special Notice Regarding Pro Forma and Non-GAAP Information This presentation sets forth certain pro forma financial information, which is summarized in the appendix. This pro forma financial information gives effect to certain recently completed acquisitions and divestitures. Such pro forma informa
Slide 5: TransDigm Overview
TransDigm Overview DISTINGUISHING CHARACTERISTICS Highly engineered aerospace components Significant aftermarket content Proprietary and sole source products High free cash flow Proprietary Pro Forma Pro Forma EBITDA Revenues Revenues⁽¹⁾ As Defined ~ OEM ~ ~ Aftermarke Aftermarket t ~ (1) Ba
Slide 6: Financial Performance by Market Channel
Financial Performance by Market Channel Highlights⁽¹⁾ Market Review – Pro Forma Revenues⁽¹⁾ Q3 Performance vs. Prior Year 5th qtr in a row of y/y organic growth Q3 YTD Commercial OEM Commercial Airbus & Boeing rate increases proceeding, if not OEM: Up 20% Up 15% accelerating BizJet OEM – h
Slide 7: Fiscal 2011 Outlook
Fiscal 2011 Outlook FY 2010 Pro forma FY 2011 Sales Mix⁽¹⁾ Market Expected Growth⁽¹⁾ ~ 30% Commercial OEM Up Mid to High Teen % ~ 40% Commercial Aftermarket Up 20 + % ~ 30% Defense Modestly Down Assumptions Guidance Summary ($ in millions) Low High Worldwide RPM growth 5 to 6% Revenues $ 1,189 $ 1
Slide 8: Operations & Value Creation
Operations & Value Creation 2 Plant Consolidations Completed Talley Actuation Dukes Aerospace 2 Plant Consolidations Progressing McKechnie Tyee McKechnie Electromech Focus on Value Creation Value Pricing Profitable New Business Productivity Improvement 7
Slide 9: New Business – Airbus A350
New Business – Airbus A350 Access Panels Latches Various Aluminum-Titanium Rods Cockpit Security Door Module & Hinges Fuel Couplings Engine Applications A350 Rolls Royce Fuel Valve Various Nacelle Rods Engine Ignition System Fan Cowl Latches 8
Slide 10: Third Quarter 2011 Results
Third Quarter 2011 Results ($ in millions) Q3 FY11 Q3 FY10 Revenue $325.2 $214.2 51.8% Increase ● Organic sales growth 13.2% Gross Profit $183.1 $122.4 .8 Margin Point Decrease Margin % 56.3% 57.2% ● Improvement in the base business ~ 3 margin points ● Dilutive acquisition mix of 4 margin points inc
Slide 11: Liquidity & Taxes
Liquidity & Taxes ($ in millions) Cash Q3 FY11 FY 9/30/10 Net Cash Provided by Operating Activities $143.7 $197.3 Taxes Capital Expenditures ($12.2) ($12.9) Q3 ETR: 35% Free Cash Flow $131.5 $184.4 FY11 ETR Estimate: ~35% Cash on the Balance Sheet $549.3 $234.1 Liquidity EBITDA As Defined 7/2/20
Slide 12: Appendix
TRANSDIGI GROUP INC. ~~ a, NI Appendix
Slide 13: Reconciliation of EBITDA and EBITDA As Defined to Net Income
Reconciliation of EBITDA and EBITDA As Defined to Net Income Thirteen Week Thirty-Nine Week Periods Ended Periods Ended July 2, July 3, July 2, July 3, 2011 2010 2011 2010 Net income $ 56,280 $ 44,005 $ 104,739 $ 112,810 Less income (loss) from discontinued operations (2,088) - 16,827 - Income from
Slide 14: Reconciliation of Reported EPS to Adjusted EPS
Reconciliation of Reported EPS to Adjusted EPS Thirteen Week Thirty-Nine Week Periods Ended Periods Ended July 2, July 3, July 2, July 3, Reported Earnings Per Share 2011 2010 2011 2010 Net income from continuing operations $ 58,368 $ 44,005 $ 87,912 $ 112,810 Less: dividends paid on participating s
Slide 15: Reconciliation of Net Cash Provided by Operating Activities to EBITDA
Reconciliation of Net Cash Provided by Operating Activities to EBITDA and EBITDA As Defined Thirty-Nine Week Periods Ended July 2, July 3, 2011 2010 Net Cash Provided by Operating Activities $ 143,711 $ 155,263 Adjustments: Changes in assets and liabilities, net of effects from acquisitions of busin
Slide 16: FY11 Third Quarter Earnings Call
FY11 Third Quarter Earnings Call August 9, 2011 15 August 2011